Ron Caruthers 0:00
All right, welcome, everybody to the Make More Keep More show. It has been an interesting week as it not the craziness at the court levels. We had markets a great day, a terrible day. I haven't even looked to see what it's doing today. There's talk of recession, all kinds of madness going on. So we thought this was a really good time to chat about what do you do when a market crashes? What do you do in a recession? How can you come out ahead and thrive during really, really bad times? Which may or may not be ahead, Don, welcome aboard. For those of you that are brand new, this is the make more, keep more, we talk about all things related to your money, keeping it, making it, growing it protecting it. And one of the questions I got Dominic, as you are joining in, by the way, I'm Ron, that's Dominic of real busy advisors. Dominic's got a big time us by the way, he's got to go getting messages that he's got to go right at nine o'clock. Because Digital Marketer, he's on their podcast today. Does Dominic invite me to come along with him?
Dominic Cummins 1:11
No, you know, it's, it says time, sir. You know how it's like, you never get invites anywhere. And then all of a sudden, you have three invites in a row. It's just one of those. It's that that was this week.
Ron Caruthers 1:23
Yeah. Right. What are you gonna do? So we got a couple of questions rolling right in here, which is one was how sure, am I that we're going to go into recession? And I don't really know. Is that, you know, that's what we get. That's what Dominic and I get the big bucks for is to admit, is to not know. Yeah, it's kind of like the stock market. You know, like, what's it going to do? I don't know, it's gonna go down, and then it's gonna go up, or it's gonna go up, but then it's gonna go down, you know, it's just gonna do its thing. But for sure. I thought we chat about today. Like I said, Really? What do you do? First of all, Dominic, what would you say that you got to do? What? What would you say advice? As far as like, if there's a recession going on? I know, we were talking about your big time. Client, I won't say what industry, you can say that I don't want to I don't want to divulge company secrets and stuff like that. But I know you have a client at the very high end of the market. Yeah. So tell me about their mindset and how they kind of fared during COVID. And those sorts of things?
Dominic Cummins 2:32
Well, I think to answer your first question of like, what you do this goes back to an episode I think if I counted this, right, this is episode 11. Of the make more, keep more show. But the the we went back a few episodes ago, we talked about how cash is king. And I think that's one thing to really keep in mind right now as cash is king. One, it can cut down some volatility, but there is there are going to be opportunities, there are already opportunities that are popping up for any number of things. And it's all going to matter whether you have cash or not to take take advantage of those things. And I'll tell a story a little bit about, you know, some advice I got recently when cash was burning a hole in my pocket. But I think also the interesting thing is, is yeah, by the way,
Ron Caruthers 3:12
by the way, if I gave it to you, I was like, just freaking let it sit there for a minute.
Dominic Cummins 3:17
Like, yeah, well, you need to be
Ron Caruthers 3:21
invested at every moment of every day, because opportunities will come up. And if your capital is all deployed, you miss out on
Dominic Cummins 3:30
him. Well, so I mean, we'll talk about how then can say, yeah, you actually reaffirmed what it was from, from another friend of mine who's incredibly successful. And he was said, we were talking about something I was like, Oh, I'm thinking about investing in this. I'm thinking about investing in that. What do you think, do you want to get in on these things? And they were good investment opportunities. But he was like, Yeah, I don't quite understand, like, why is the cash burning a hole in your pocket? And I was like, Yeah, but what if we only put like 50 grand down? Or what if we put 100 grand down? You know, they'll still have cash like, and he's like, yeah, why don't you just wait. And he and part of his advice was, he said, and this was about a month and a half, two months ago. And he said something to the effect of like, basically, like stop chasing, deals to invest in. Yeah, just be open to deals to invest in. And, interestingly enough, now the deal didn't work out. But funny enough, I was on a conference call was with a mutual friend of ours. And all of a sudden this we find out a family member died in a business that was in the alcohol space. Right. So distillery, the family member had died. They're trying to offload the business in a hurry. We missed that opportunity. But that was when it like really clarified to me what exactly he was talking about is at that moment, I texted him, he's like, oh, man, find out more details. Let's do it. Because it made so much sense. How can I burn cash on another deal when I had cash for that deal? Now? Like I said, it didn't. This one didn't go through. But it really was that realization for me of hey, yeah, if you just wait patiently and just keep Your eyes open, you'll find some really awesome opportunities. And that's just gonna happen more and more. As the as the weeks and months progressed. I mean, think about some of the stocks you may have been following for a while. And all of a sudden taking a pretty big hit. Are they still fundamentally sound companies? Yes. So, you know, buy them when they're at a discount. So I think a lot of it just has to do with cash is king and then, of course, being patient, you know, and not rushing into that next deal.
Ron Caruthers 5:26
You know, that's a really interesting thing. A buddy of mine reached out to me this week. And again, I won't say his business, but I am a frequent customer of his business. And, and by the way, so
Dominic Cummins 5:39
it's a weed store.
Ron Caruthers 5:46
I was double espressos. And I can slam them all day long. I like vodka martinis and Manhattans. That the other thing, man, I was just never a fan. And sorry, Mom, if you're listening to this, but yeah, just makes me feel weird. So
Dominic Cummins 6:03
season, I was teasing.
Ron Caruthers 6:05
But, but anyway, he was reaching out to me because he had sold an asset of his business for a substantial amount of money. And he had some tax questions. But he had some other questions. But the number one thing that I told him, by the way, which is what I do, anytime anybody calls me for advice is, let's get your strategy right first, don't do anything rash. So I told him, like, we gotta get a couple of let's get a couple years of your tax returns. First, let's look at what's going on in that side of things. Let's have a conversation with you and your wife about what you guys want happen next. And I'm like, Look, I'm gonna be out of town for a couple of weeks. I'll talk to you while I'm there. But you're not going to do any dumb crap, are you? Well, I'm gone. Because because it's burning a hole in your park. Yeah. So I would say, first of all, let's come back to this talk about thriving in a in a in a bad environment. This is the first thing that I would always say is Oscar, we got you. By the way, I just saw a question roll across, we are having the actual credit queen of Twitter, come on in a few weeks. It's gonna be rough, because she cusses like an absolute sailor. And she's freaking awesome and hilarious. But I'm gonna have to sit her down and have a little chat with her and be like, Irene, the children, what about the children got to double A man, he's gonna pick up some words that he doesn't shouldn't be using yet. At least 10 years old before he starts using those words. But anyway, let's come back to this. So strategy is always first. Just because there's a recession, you can make a conscious decision that you will not participate in that recession. Literally, it is a conscious decision, that it doesn't matter, you're not going to go sell your car or liquidate all your stocks, we're going to chat about what you should do in a moment. But it doesn't mean you should liquidate all your socks or go get a tiny little electric vehicle because gas is at $6 a gallon. And look, there is some reality that I'm not being insensitive to that. But at some point, you have to realize that people make fortunes, in up markets and down markets. And you just have to decide that literally, you're not going to participate in you're going to keep your mind open to opportunities. And you're not going to let the media and stuff which is manipulative affects you. Right. And that's not that's not a Trump thing or anything like that. That's literally like the media, you know, make magnifies everything and makes it 1000 times worse, which is kind of why I hate them. And
Dominic Cummins 8:45
so they gotta sell commercial space. Right? Yeah. I mean, there's a there's a question I always loved to ask in these types of markets like and I think this is exactly what you're talking about. And kind of goes back to when you were asking me about my client is like who benefits there's always somebody who's benefiting no matter what way the markets going now when the market is generally and when I say market I'm referring to like real estate and stock market and like any market is going up any market. It's, as a buddy of mine said I think I said it on the show one time a buddy of mine said on an interview I did for a conference a few weeks or a few months or excuse me a couple years ago now right the beginning of COVID He said we've all been bowling with the bumpers up, right? In essence if you just throw remember right? Yeah, if you throw the ball down the middle or if you throw it somewhere down there, you're gonna probably hit some pens because it's gonna bounce off the bumpers that's what happens and of kind of a generally rising market the rising tide lifts all ships kind of scenario. So my client I was doing some research this week for my clients in the luxury travel space so it's in it for a week vacation with them runs about a million dollars a week 750 On the low end million dollars a week. So
Ron Caruthers 9:54
Dominique rules in a world in I saw you join pay attention to Dominic, you need to know his cuts. summers fair. So really, we
Dominic Cummins 10:03
Yeah. And you think in terms of like now, like everybody else, they had to shut down a lot during COVID, because just travel restrictions and borders closed. And, you know, certain areas and islands in the Caribbean and Mediterranean all closed up, and you know, whatever. But now that things are emerging, so we ran some numbers. So if you look at the travel industry as a whole, they were down by 50 60%, depending on where they were as a whole. But there was one aspect of the travel industry that almost doubled it was in 2019, it was 6.5 billion in 2020. It was 12 billion care to venture the guests of who was benefiting in the luxury ultra luxury space.
Ron Caruthers 10:42
I have no idea I would go gambling because people were all
Dominic Cummins 10:46
probably right, probably. But the actual reality was it was private yachting industry went from 6 billion to 12 billion, and you say, and now that's including new builds for yachts. But it's a crazy that in 2020 1000, New orders went in for super yachts. So while people and that's you know, you sit for a minute and think like, well, people were dying in 2020, and other people were recreating billionaires by the minute. In fact, there was another study that said that, like, billionaires were being created every 17 minutes and 2020. And you think about there are people dying every couple of minutes in 2020? So it's just it's it's or seconds? Probably so yeah, Oscars. Yeah, mind blown, right? So the pieces is that you, there are opportunities, somebody's making money somewhere. And so you just have to be aware of where that could be, and how you could benefit from it. And the piece that that's so critical that we started with is be patient. Wait it out, see what does. And when something strikes you it's not that you're gonna be 100%, right every time but something's gonna strike you is like, oh, my gosh, this is the perfect opportunity for me. So it's opportunity everywhere.
Ron Caruthers 12:01
There was a guy, I don't know if you guys know this story. And for everybody just joining this was to make more keep more podcast, that's Dominic of Rabins advisors. I'm Ron, and we chat about all things in money. But today, we're chatting about what to do in a recession or a bear market. I don't know if we've officially hit the bear market, I have to look a bear market, by the way, just so you guys know, is defined as a 20% drop in the market. So I kind of think we're there. But if not, we're pretty close. So the question is, Okay, what's next? Well, here's a crazy story. There was a guy once who picked up the huge chunk of downtown Houston. Back in the 80s, I think it was the 80s When the oil markets crashed, and literally cute downtown Houston was a ghost town. Houses were abandoned, stuff was abandoned. So somebody went in and for like 100 bucks. And I'm kind of what you're in the story, but I'm kind of not they picked up huge chunks of downtown Houston. That as you can imagine, when markets returned, those houses were worth a lot more than 100 bucks apiece, but because the person had cash had access to capital, which is the number one thing that screws up people, they don't have access to money when they need it liquid cash. Then they can jump in and see like, I mean, look, how much do you need to know about the Houston real estate market to know the minute you can buy a house for 100 bucks back in the 80s? probably a pretty good deal. By the way, the same thing happened in Manhattan more than once. Were real estate in downtown Manhattan, one of the most expensive places on the planet to live has crashed. And people have picked up homes 3040 cents below where they were at. So what I want to talk about, we got a couple of questions about Hey, should we liquidate stocks or move things around? This is my opinion. And it's just thought and it's a it's an opinion, but it's based on 30 plus years in financial services, and watching the.com ran up in the late 90s. My business was called a toxin investment advisory back then. So I knew a market crash was near when little old ladies would drive by my office in Vista, which is North County San Diego. It's like one town that way from where I'm at one turnover not from where I live now. And they see oh you do investments. I want to put all my money in Cisco. I want to take my CD money these big ladies in their 70s I'd be like Do you even know what Cisco does to like, Oh, I heard it does this internet thing and I've heard really good things about it. I'm like out of my office. You do not want to move your money into Cisco right now. This is like opened up so much and I hear it on the news and they talked about it That's a sure sign that the end is near. So now let's talk about it. If you're in the other side, you're like, Oh, my God, I'm losing money. Hunter S Thompson had a great quote. Which was, by the way,
Mo Max, ask a question, put in the questions, put it over there, do it, we will answer it, maybe. But most likely, Thompson said buy the ticket, take the ride. So if you're 100% invested in the market, and you're just now seeing a bear market for the first time, which really wouldn't be true, because we had one in 2018, where the market dropped 25%. We had another one in 2020, when the market dropped 40%. But for some reason, I will tell you guys, this one feels different to me, probably because feel the way the media is typing it. But that's not the time to decide that you don't like the market. And so if you decide you don't want to like the market, you decide when the markets up to move some of your money over to cash, which I believe you should have cash equivalents at all times. Anyways, time permitting, we'll talk about a couple of areas that I like to recommend and keep my own money in rather than just a savings account or checking account, we'll talk about a couple options. And but the idea is, if you're in and your whole portfolio is down, you just got to write it out my friends right now, because you want to always be a smart investor. And a smart investor buys low and sells high. That does not mean you do drugs, before getting hammered before you liquidate your portfolio, it means you actually sell for more than you bought. Or you buy high and sell higher and nothing wrong with that. It's just you don't want to liquidate at a loss. And you don't want to Oh hit McKenzie. And you don't want to have to be forced to ever sell wire downs. Which is why you always don't want to have all your money in the market at one time. Because you always want to have access to cash that is not subject to market losses, because then you're not going to have to sell when the markets down. You know, and that ties right in with some of the conversations we've had Dominic over the last couple of weeks about mortgages and housing. And the same thing with housing, don't put yourself in a bad position. You want to be like Charlie Sheen, if you guys are old enough to remember when Charlie Sheen lost his mind. And he was talking about his Tigers blood. And he's like, man I buy when I went on this hand, I went on that hand. And if you put yourself in a position not to lose, then all you can do is win. And y'all should be writing that down. Because that's some deep thoughts right there from your friend Ron.
Dominic Cummins 18:02
Yeah, I mean, look at that patience is everything right now I think, again, looking at where if you're invested in stuff, and you made likely made some decisions to buy some stuff early on. Whenever you bought that thing you invested in that thing, it's because you did hopefully did some research, I thought it was a good idea. I saw some things about that company that make a lot of sense. And so therefore write it out because those things probably haven't fundamentally changed just because the market itself is the you know, there's there's a some sort of adjustment that's going on that may or may not be rooted in reality. And that's that's part of what happens sometimes with stocks is specifically talking about stocks or heck, even real estate, it's just all sudden, people just don't want to pay a certain amount. And you get this like mentality mob mentality that sort of just takes over. And all of a sudden, there's this drop in the in the the the investment itself. If you go sell that right now then you're selling purely based on emotion, and you're moving moving, you're handling your money in a way that has to do pure with emotion, rather than any sort of factual basis. I mean, do we do I have some socks right now that I look at? I'm like, Ouch, that hurts. But then I go, Yeah, but fundamentally, why I bought it was this, this and this, and has that change? Now? Okay, well, I'm just gonna write that out. And so it doesn't you got to you got to understand the fundamentals of why you bought it in the first place and hang out with it, because it's, it's gonna have its moments where it's going to be down. So the Yeah, so sorry. I'm checking out the questions. Also understanding these questions right now. So, I know while she's sending me the questions, I want to make sure I sure I want to give them what they want, Ron?
Ron Caruthers 19:43
Yeah, man. People know it's what we want. Dominic is about our house. Oh, is it 100% My kid wants grant in. You know what we might even have Brendan on next week. That's my kid that's going to law school that is not the Barefoot vegan hippie lunch. I'll Brennan Stone Cold businessman, but Britain wants when he was like 17 He wanted to spend the night in his girlfriend's. What? No. But he's like, Well, you don't understand these, like, Don't you care about my happiness? I, I'm trying not to laugh at him. But like reading your happiness is so far down the list of things I care about your safety, not being a grandpa to you know, you when you're set your kid when you're 17, your future life, whether you're a nice kid, all that stuff is on my list of happiness, your happiness, nowhere even close to it. By the way, Warren Buffett had a great saying, which is when the tide goes out, you get to see who's been swimming naked. And you know, it's really easy. There was another great saying, which is never confused, a bull market with brains. And so I want to break this down dominant kind of moving forward. I know we got some questions here, we'll get some and I know one of us posted the question a couple of times, by the way, someone talked about the palm trees in the background. Oh, have you got to know it's like 55 degrees out or even a pair of shorts, it's foggy, there's kind of a breeze going and so yet Southern California, but it's not always as warm as you guys think it is. So a couple things that will break the remainder of the conversation down into Dominic. Sorry. I want to talk about your mindset and your business if you guys have one. And where are the opportunities laying? Number one, and then I want to talk strategically about if you are overweighted in stocks, then what should you do once the market recovers? And even what I'm telling for a couple of my clients that are maybe finding right now that they don't have the risk tolerance that they thought they had? So I don't know which one do you want to get some questions? First, let's grab some questions real quick. Yeah, so dive in for the bottom for the second half of the hour here because Dominic has to go right at 9am because he's on the Digital Marketer Podcast is he invite his friend Ron to come with him he does not
Dominic Cummins 22:14
you know, I will get like that I will work on getting my friend Rana invite. I'm not sure why they invited me to be honest with you. But so
Ron Caruthers 22:21
to speak. You speak you spoke on the same stage a couple of years ago that Rachel Hollis was on when she was the
Dominic Cummins 22:26
it girl. You know, that's true. And then I actually got the really cool thing about in New York to speak right before Gary Vaynerchuk. I was glad I did not have to speak after Gary Vaynerchuk. But it was awesome to know exactly. So I just assumed they all came to hear me and got surprised with Gary Vaynerchuk. That's why there's so many people in the room. Might not be why there was so many people in the room. But but it's all good. So yeah, I think if we want to hit Do you want to hit specifics on investments? Because I think there was a mention about commodities and some of those you want to do those first or do you want to come back to those on the second? No, let's do them. All right. So what's your thoughts on the question specifically? From maybe a meal, Max? Eight? I don't know. What are you guys thoughts on investing in uranium oil and other commodities right now?
Ron Caruthers 23:10
So I was buddies with Ken Fisher? No, not Ken Fisher, Ken Roberts. Wrong, Ken. Ken Fisher is the guy that's like annuity shark. And I hate on him. And you should too. And then you read the fine print of his and he's like, Well, actually, certain annuities are really good. He's one of the biggest annuity sales on the planet. And he's got a massive headline. That's terrible. So Ken Roberts was the commodities trader. I think he got spanked pretty hard by the FTC, but actually had a really good commodities trading system. So I mean, I know you put the question twice, but I honestly don't have an opinion on that. Mainly because my commodities trading experience, I had the absolute worst experience trading commodities ever, or even investing in because of my very first trade, like a $300. Trade, I made like six grand when I was in my 20s, which immediately made me think this was easy. There's nothing to this. And so I proceeded to lose many times that six grand over the next few months before I realized, I don't really like trading commodities. And so there are huge amounts of money made in those markets. But I'm really not competent. And even investing in them before a crisis. The macro trends would make sense on that. But it would absolutely be outside the area of my expertise to comment on any specific markets. And it would border on malpractice, because I really, it's an area that I really don't know what I'm talking about. So I'm sorry, you wrote the question twice. And it's really not when I'm qualified to answer because they're markets that I don't really pay that much Attention to, except to say that I know a ton of people have made really good money for it. It wasn't the markets themselves, it was my tolerance for that, that I just realized I didn't have. And it was a lot of research a lot of patients. And again, this was more of the active trading. Not so much of the buying and holding. But I'm really not qualified to comment on any of that. Nor would I say that Dominic is either if I can be so bold, Dominique is to speak for you. He doesn't know what the hell he's talking about, about this stuff, either. So he says about it, don't listen to him on he starts drinking sometimes early on Fridays. I mean, I wish somewhere right dominate.
Dominic Cummins 25:44
I wish I wish it was yeah, thank
Ron Caruthers 25:46
you. And thank you, let me see JP, you know what we try, we try to keep it real here. And it's just like it said, Me, I'm so sorry. Like, I'm really like, do not listen to anything I say on that because it's wrong.
Dominic Cummins 25:59
The only thing I can add to that, because I don't know anything about commodities, the only thing I'd say is any investment, do your research. I mean, I know that sounds super basic and boring, and like not like podcast worthy. But this is true, do your research. And if you feel comfortable with it, and everything points to like, this makes a lot of sense for you and your portfolio, then do it. And I think it's like anything of any other nature to is, you know, the guy is putting in the only $1,000 they have into crypto is a bad idea no matter what it is. So make sure that your asset allocation, which is an old old school concept, and it won a Nobel Prize for a reason. You know, asset allocation is important, put your money in places that makes sense. And that's the only thing I could say is if it's part of your portfolio, if it makes sense, you're hedging it in other ways, then and you feel comfortable with it, you're well researched and that know everything about it, or as much as you can do it, but don't just chase a trend. And I think that's just general investment advice that has nothing to do with with with commodities.
Ron Caruthers 27:02
However, in my wholly uninformed, you shouldn't listen to anything I say in my lawyer is probably twitching, if he's watching this right now, if you look at the macro trends of what's going on with, you know, kind of Warren or current Ukraine and some of the wheat crisis that they might be seeing, and some of the oil crisis is gonna be a play by not be a bad time to invest in that, you know, as long as it's money that you're comfortable with, because particularly if you're doing commodities, a lot of them get traded D on options, meaning a tiny little bit of option premium could control a huge amount of wheat, or corn or uranium, or whatever. And those markets move fast. So you're highly highly leveraged, which means a couple points move to the upside, and you make a ton of money. If you're long, couple points to the downside, uh, you, my friends, will be selling your worldly possessions to cover that. So you know, be careful there. I want to talk about something else, Dominic, if you don't mind, and then I want to jump into some business stuff. But one thing that we've kind of danced around is what is an appropriate asset allocation. So again, back to the disclaimer, of everybody's situations are unique. You're not a client I met with yesterday that I was doing some tax work for. And I literally was like, Look, I'm gonna go on a podcast, you know, and post on Twitter, within the next couple days and talk about how you don't want to max out your 401 K's because you have an on you have a liability that can't be quantified because we don't know what tax rates are going to be in the next 1010 1520 30 years except to know that the government's $30 trillion in debt and 10 years ago, there were only $15 trillion in debt. And I posted this on Twitter. But to give you guys some idea of how massive that is. If $1 is one second, and there's 86,400 seconds in a day or dollars in a day. $1 million is 12 days. All right, I want you guys to think about this for a minute. A million dollars is 12 days. A billion dollars is 31 years. Are you ready for this? Dominic? A trillion dollars is 31,000 years. So we're $30 trillion in debt as a country, which means we're 930,000 years in debt, spending $1 a minute. I mean, $1 a second, excuse me dollar a second. We got 930,000 years to pay that off. So back to trends for a moment who can say taxes are going higher but they're going higher at some point and probably not by a little probably by a lot. And so back to like what's an appropriate asset Alec? nation, particularly now that we're in a bad market. Again, if you're 100% in crypto in stocks, and you're getting your ass handed to you, then do not turn around and make the panic moves now. You wait, write it out until you're at least somewhere close to break even. And then you turn around and reallocate, because you've done messed up. Particularly, and if you're not liking it, it's good for you. By the way, this isn't even really like, if you guys were through 2008. Man, that was some that was some crap. If you guys went through 2000 2001 and 2002, that was a long extended bleed. That just sucked. You know, I mean, we just sat there like, Is this ever going to end. But all of the overhead pressure had to work itself out of the system. But what happens is, is when you have markets crash like this, I'll get to what to do in a moment. But what happens is, people have all these different levels that they're like, when it gets to here, I'm out. So as the market kind of bottoms out, it comes up a little bit. And then all those people are like, Gee, T, fo, I got to sell my stuff, and the price was too great back, then those people don't get cleared out. And then it's got to come up a little bit more. And all these people are like when it gets to here, I'm gone. And then they clear it out. And it's got to do that a few times, to just work all that what we call overhead pressure out of the system.
Which is what we're talking about today on the make more key more podcast, which is that's Dominic a real busy advisors gotta get the plugs in for you guys that are just joining us. But we talked about all things running. Today, we're talking about what to do in a crop market. So again, I'm just like, it sucks. I know, you should, if you needed to spend that money in three or four anyways, it shouldn't be in the market. I get clients like, and somebody this last week, Dominic, like, hey, and again, they're thinking well, but they're like, well, we'd rather just pay our property taxes once a year, rather than having it taken out of the escrow. So where can we put it to get a, you know, eight or 9% rate of return? And then just pay it off? We can make money. And I'm like, No, we're don't do that. Because to get that rate of return, we got to take risk and risk takes time and look to worse markets in history lasted three years, the Dow market crash of 29, as well as the.com meltdown that it took a couple more years, we were years to get back. So there is always an end to it. Right. But then we'll just reassess. So generally, what I recommend to my clients is take your 401 k up to the match. If you're in a really high tax bracket or a high state, yes, you can go more than that. But as a general rule, if you're even up to the 24% bracket, I'm like, that's a reasonable rate tax rate, you're probably not going to be cheaper, go ahead and pay the tax on it, get it over with, we recommend and watch the follower count. Because you guys are going to think I'm nuts for a second, don't jump off the call, you're going to miss some good stuff. But for instead of bonds in a portfolio, we recommend to our clients cash value life insurance set up properly, properly as an asset class means that you put the minimum death benefit, because the IRS gives you a ton of benefits with this, if it's set up correctly. No, absolutely. There's some flaws as well, too, which we'll cover in another thing, the fees are a little high in the early years, there's not a lot of accessibility to the cash in the first couple three years. But hey, it's no different than if you bought a house, you're not going to instantly have the equity in most markets. So it's not totally crazy. But what it allows you to do is get the upside of the stock market with no downside. None. gains are locked in every year on index universal life insurance. Now you might not get all the stock market. But again, it's not to replace the market piece is to replace the bond piece. And it has Roth IRA tax advantages. Meaning all your gains are tax free, if it's set up correctly. And you don't have to wait until you're 59 and a half to access it. So for a lot of my clients and get a portion of their money goes here, it's what I do also. And now I actually have referred to that as entrepreneurs IRA, because you don't have to wait until you're 59 and a half to access it. So we can use it to fund business product projects. And any it sits as cash sort of market like this as assets become available and look man in 2008 2009 when we had a real bloodbath, a 40% market correction Sherman, and a housing correction, and people just walking away from their houses. If you had cash, you can pick up all kinds of assets from stock market, to housing, to nice cars, to all kinds of stuff for pennies on the dollar. So that's the reason we recommend. And then yeah, I gotta, I gotta have one troll in particular, who follows me around on Twitter. And he was like, You rip people off? How do you even sleep with your stuff at night? And it's tiny, QA that is such a low IQ take. And by the way, the guys that explain this to me, I spent three years fighting them and trying to prove that they were wrong that life insurance was a scam. Not if it's set up correctly. So again, it's not for your entire portfolio, it's to replace the Safe Money portion of your portfolio, call it 4030 40% of what you're doing. And then 20%, you know, 40 is going in the 401k, where like, 20% should be brokerage for crypto, real estate investments, those sorts of things. So that's just kind of my thing. But my clients have the cash to in their policies, if they follow that portion of the advice, and not everybody does. It's not appropriate for everybody, but most it is. So now they're like that guy, the meme of the guy hiding behind the tree looking around, like, what am I going to buy? Because we can get our hands on that money in three days. So that's my little rant. Dominic, did you actually want to say something? I mean, this is our podcast. Do you want to get a word in?
Dominic Cummins 36:31
No, I'm just mostly here for the eye candy. So it's what I'm my role is in this podcast. So yeah, I think that was a very good question may pop back up there. But no, I think
Ron Caruthers 36:44
Hold on. I'll get that one. Yep, correctly means you are at the seven payment amounts. Are maximums meaning there's a limit that the IRS sets you're right at it. If you want us to take a look at that. Just shoot out in the DM say you want on the podcast. And I can take a look at a policy in two seconds and tell you if it's set up accurately. And if not what we have to do to set it up accurate accurately. And oh, you got to family said your local crack baby says you're so chill. There you go. He actually is. Um, but anyway, so happy to take a look at that for you. But all right, Dominic, you can say something now I suppose. I'll just sit here.
Dominic Cummins 37:25
No. And I think again, the all of this is really good advice. Because understanding right now again, I'll go back to that expression that my buddy, it's actually a guy named Mike RC really cool guy does a marketing for fitness studio. So if you have a fitness studio, that's that's your man. But I don't know, Mike, but I know of Mike. Yeah. And he's super smart, great guy. And he was the one who said to me like, yeah, we've all been bowling with the bumpers. And I think right now what you can do, though, it's again, a great analogy for when the markets are up. Most people are benefiting rising tide lifts all ships, you know, people tend to be doing pretty well. And we can get this sort of, you know, cognitive bias or whatever you want to call it that says, oh, it's going to just keep on going, then I've done so well. And this is one of those markets over the last couple of weeks. And then even some of the stuff that happened during COVID is partly as an entrepreneur, I look at it like cool, bring it on, because it's probably eliminating some of the competition. Not to be too harsh about it. But it is that is some of it because some people are not going to weather this well. So one and I know you wanted to talk about mindset and apartment, it's good transition into it. But you know, understand, you can still win in this market. But you have to look at things like what Ron just talked about, that you may have heard something about, or you may have read a tweet that was negative and told you never buy cash value life insurance, or whatever. And you got to look at those things. Because those are the things that will help you weather that storm, whether it's that particular investment or another type, there are things that will help you weather the upcoming store. And that's so that's the preservation side of it. So so if you're just joining us, they make more, keep more podcasts. Now, a lot of times we talk about it more from a tax perspective, that's Ron's like, specialty I mean, one of his specialties is tax right. So helping you save more money, but it also means keeping more money when everybody else is losing, because of the market trends. And then you still at the same time can also make more money when the trends are down. Because that's what we opened the show up if you didn't join earlier, I shared a statistic. And I work with a client who is in the luxury travel space runs about a million dollars a week to do a vacation with them. And we were doing some sad, sad studies this last week I was training 15 of their sales and marketing people this last week on how to sell their products and all that stuff. And they were we did some research together and they we the travel industry, for instance was down by 50% but the private Yachty market would doubled in 2020. So People are wanting more exclusive things. And there were billionaires being created every few minutes and 2020 while everybody else was losing money, and we heard all the stuff that was going on negatively in the economy. So keeping your mindset, right, that there continues to be opportunities, and I see this all the time with entrepreneurs that I coach or work with is, they get into this type of thing, and you're gonna hear no, a lot more than you did before. When you're in sales calls, you're gonna have people who go, Hi, I'd love to do this. And but I just can't right now, I just can't do it because of, you know, whatever, or I'm nervous to move forward. So you're gonna hear that more often. It doesn't mean you're going to always hear it. And I'll see people just sort of give up on their prospecting efforts in their marketing efforts in their business, because they're like, I'm never gonna get any more business, not to put your foot in the gas and go like this is a good time to do it, but also reevaluate who's benefiting? Because somebody is benefiting? And so you can use that as an opportunity to say like, well, then how do I serve those people that are benefiting right now?
Ron Caruthers 41:07
Totally. You know, an interesting thing on that is what, first of all, even if you're getting told no more. So let's talk about from a business standpoint, this is a great time to grow your business, particularly if there is a recession. And look, I hope there isn't one. I can't speak for you, Dominic, because you're kind of a jerk. Sometimes you probably.
Dominic Cummins 41:29
Yeah, I mean, just like,
Ron Caruthers 41:33
but I hope there is it. But if there is, it is a great time to grow your customer base, because your competitors generally will run for the hills. It is a great time. I mean, look, I would have loved to have been in the banking business, doctor, totally what's happening little dude. Why aren't you in school? Doubly? I got you in school. I'm gonna go right now. All right, I
Dominic Cummins 42:01
just wanted to say goodbye to Ron and mean, bye.
Ron Caruthers 42:04
Goodbye. And so I love you. I'll see you we're gonna go to Legoland. As soon as I get back into town to why I love you too little guy. I think doubly on every episode,
Dominic Cummins 42:17
every episode.
Ron Caruthers 42:19
You know why? They're so cute. And then their size. Back to this. This is a great time to build your customer list. Because even Dominic, like what Dominic said a couple minutes ago is okay, you get told no more often. Great. Get those people on your email list. Get them on your physical mailing list, follow up with them because the market will not stay down forever. Get them so that you can when the tides turn and they're not scared anymore, or nervous or whatever, just in protection mode, that you're the one that's been there the whole time talking to them and reassuring them and doing it. So now you're the obvious choice man at Trump like five degrees. You're the one that's there. It's the same thing. By the way. If you know Scott Adams has a great book. If you guys don't know who Scott Adams is, he's the guy that drugs Dilbert. I think it was kind of an interesting he kind of turned political pundit and he was the guy back in 2015, that when Nate Silver 530, a polling company said that Hillary had a 98% chance of winning, Scott Adams is the guy who went on record that Donald Trump had a 98% chance of winning and he actually had reasoning behind it and trends and things that were going on. Long before any of that he's had a bunch of other businesses other than just doing the Dilbert comic strip. And one of the things he talked about. And by the way, this applies to everybody except Alessandra and Stephanie, our respective Office admins, managers, whatever you want to call him, he's like, You should always be looking for your next job. You don't go interview for a job you're always looking for it and the book, How to fail it almost everything and still succeed is worth it if you read nothing but that far and it's like only two or three chapters that so now's the time if your job sucks to go start looking for another one. Because if you can bring value to a company, you know, this is the time that they need that more than ever if there is a true recession, this is the time to grow your customer list and grow your customers because you have to know that your your competitors will pull back on their advertising and pull back and just sit and wring their hands and be scared and you really need to tone down the media because the media will always try to scare the crap out of you because that's what styles there was a comedian years ago called Richard Jeni and Showtime special and like 90 or 91 I saw him live a bunch he was hilarious. Sadly he committed suicide like about A dozen years ago, but he was a hilarious Comedian. And he was like, Why did they even call it the news? It's the bad news. And he made the joke like in your town, people are dead. Let's go to Bob with the national news. How's it going? John? People are dead and dying and suffering. That's the media the model because that's what's that's what sells. And so yeah, World War Three breaks out, you should probably know about it. But your friends will tell you. So really make sure that what you're putting in here, you're being really careful on you're not buying into like, oh, businesses bad. No, I gotta be nervous. They're still guys placing orders for stocks, they're still I mean for luxury yachts. They're still people taking million dollar a week vacations, they're still people buying and selling. So yeah, a recession still means 85% of the people or 90% of the people are still getting up and going to work every day. And a lot of it gets created by the media. And don't assume those assholes on Wall Street have any idea what they're talking about, because they all run scared too. So a lot of the money by the way, a lot of the market is driven by institutional money. So when individual investors freak out or pensions freak out, they go to their institutions to cash in. The institutions have no choice but to liquidate, which further drives the price down. It's nothing but a big emotional festival of misery. Alright, so I'm gonna
Dominic Cummins 46:39
say something. Yeah, you just covered about 14 different topics there. But let me go back to one of them that we'll talk about. So hopefully, I've got all that.
Ron Caruthers 46:47
But the more highly caffeinated than usual, I haven't
Dominic Cummins 46:51
seen it would I would I already texted Alessandra, that sounds like a lot of caffeine. So what are we I want to go back to something that you said though, I think it was 11 topics ago, but there was one that you said something about the idea of like, what people want right now. So there's a buddy of mine out in the UK, I don't know if he's tuned in right now. His name is Brian runs a really successful agency focusing on schools. But he taught me this concept he took like, basically, Maslow's hierarchy of needs, and turned it into a business format and said, What's the hierarchy of desire. And one of his pieces was to talk about the hierarchy of desire of what our clients want. But then as he built it out, he goes, I also realized there's a hierarchy of desire of like, there's a higher desirable we want and also what our clients want. So, and they typically are inverse to each other. So we want number one thing that we would love them to do is purchase something from them. Then the next thing down might be that purchase something else, right? Yeah, well, yeah, we then that's, that's the, that's the, that's the rub. That's the problem, right? We keep going like, well, let me give another purchase, let me get something cheaper for them to purchase. And I see this all the time that we were not getting a lot of traction on our main product. So we roll out a cheaper product. But think about it. Here's the funny thing is when we think about cheaper products, or customers that we work with, let's say we're in a service based business, getting retainers, the people who pay us the least are usually the biggest pains in the asses. Whereas the people who pay us the most tend to while they may be demanding tend to appreciate what we do get have a lot less hassle or whatever. So that guy who's paying you 1000 bucks a month, versus the one who's paying you 30,000 A month is vastly different human being, and usually treats you completely differently in a good way. So we then then what we do is like, Well, I'm not selling any products right now. So let me just make a cheaper product. So what you basically just said is let me invite in all the people I don't like right into my fold. So anyway, going back to the hierarchy desire wouldn't say it. So number one might be purchased. Next thing might be downbeat. You know, well, if you won't purchase, when will you at least meet with me? Well, if you won't meet with me, would you jump on a webinar with me? And then would you won't jump on a webinar? Will you jump on my live show on Instagram, and then it moves on down the list of things that we would really like. But what's interesting is they're also attached to these highest amount of trust. For somebody to purchase from you has to have a high level of trust for somebody to join on an Instagram Live doesn't take a lot of trust. Now to stay on there for a while, takes a certain amount of trust and repeat every week. It takes them out of trust, but they're just like the you know, our social media follow takes virtually no trust because it doesn't cost you anything. So the inverse relationship there between what you and your clients want. So when you get into down markets, you have to understand that you may have to dial back your hierarchy of desire to match them. Because the markets tough. They're not going to race to purchase from you as quickly as they did before when the market was good. But that's okay. You just have to find a place for them to go it may mean that you need to step up your webinars and It may mean you step up your live events that you do, it may mean that you need to go do more social media stuff that you're not comfortable with. And all of those things allow somebody else to enter your ecosystem, if you will, in a place that they can be really comfortable with. And so understanding right now that the market doesn't mean people aren't going to purchase from you, if this thing extends its reach. We're not necessarily saying it is. I mean, who knows? It could bounce back in a couple of days. But if this thing extends for any length of time, you're gonna see money tightening up I mean, the Fed is trying to tighten up the money supply right so you're gonna see money tighten it doesn't mean it goes away. And that's like what Ron also saying in there. And we talked about the beginning of the show, there are a lot in 2020 there were 1000 new orders placed for super yachts which is defined it's kind of a loose definition but anything over 80 feet with a full time crew. So you're talking serious boats these are not these are not these are Kardashian these are Kardashian on that show an oligarch boat these are get is I mean and then think about that, like the the luxury yachting industry is up right now. And tranquillity is the name of the yacht that the Kardashians love to to, to get on.
Ron Caruthers 51:15
It's that you would know that. Well, I
Dominic Cummins 51:18
work in that industry. So I happen to have to know that but
Ron Caruthers 51:22
Thomas's secret watcher of keeping up with the curtain, literally,
Dominic Cummins 51:27
I can say with with absolute authority. I've never watched a single episode no hate against people who do I mean, I watched a little TV period. But as Ron will attest, he asked me all the time. Have you seen The Wire? No. Have you seen Game of Thrones? No. Have you seen I've seen anything? I don't want
Ron Caruthers 51:42
to wait to Dominic that the wire is the greatest show. You've done that for years. No, no any issues jumping the cat chats right now and tell him what he is missing?
Dominic Cummins 51:52
So all right carrying is is those that run a million to a week? Right? It's for those types of yachts and people are buying them. So. But yeah, let me get back there was a question. So Juan Carlos. I mean, I'll start the fielding of this one. But one Carlos Ayala asked about So do you guys think housing will crash or at least home prices will go down soon. I don't want to punt on your dude. But here's what I would suggest that we just did. The last two episodes are on Ron's feed if you go into his feed, and look at the last two episodes, we had a real estate expert and a mortgage expert. The short answer a teaser alert, they both said know that the market is not setting up for a crash. Now you could make an argument they have a little bit of, you know, vested interest, a little bit of vested interest to say that, but I think they gave some pretty compelling arguments for that. So I don't think any major adjustments
Ron Caruthers 52:43
agree, I think you will see a major adjustment in the next 24 months. So but you know, that doesn't make me right. And my opinion is completely unqualified. I'm not a real estate expert. I'm just looking at how long, how fast it's gone up. And the fact that foreclosures are starting to rise, evictions are starting to rise. Interest rates are starting to rise. And I think that that you will see a decent correction, a 20% plus correction by the way your local crack babies agrees with me on the wire. And now I've got some street cred because of my love of the wire. But Juan Carlos definitely go back. Dominic is right, go back and look at my feet and watch those episodes, there was some good information. And again, we don't agree on it. And one of us will be right. But time will tell and may not be me. Again. I hope it's not me. But um, I might be what else we got.
Dominic Cummins 53:44
We got some questions about our book recommendations. And then lovely CJP said, maybe you guys can just compile a list. I think that's definitely something we can do a list of some books. So we'll
Ron Caruthers 53:55
we'll get a list for you. But I'll tell you what, definitely read the pledge. If you guys haven't read it by Michael Masterson, that's called your master plan for an abundant life. It's great. Then, um, I really liked that Scott Adams book dominate, how to fail in almost everything and still succeed. I didn't love his his election breakdown stuff. When Bigley where he kind of went through the election and how Trump won. It was okay, it was good. He's kind of funny. But I loved how to fill in almost everything and still succeed. And then he had loser fake. And I just didn't care for loser think and I really liked Scott Adams. So I'm just like, at those were a little weak. But how to fill in almost everything and still succeed is a fantastic book. You got anything you want to throw out there.
Dominic Cummins 54:44
The one that I love that I recommend most often to people is the hard thing about hard things. And I think it's probably an appropriate book at this point for people when you look at market conditions being up and down and it's the guy who launched a couple of successful software companies more Then a few names you'd recognize did very well for himself. It's really good books really easy. It's a pretty easy read but packed full of meat. That was just one that I love to tell people. Just if you're going to read one book this year, just read that one. It's a good one. So, all right,
Ron Caruthers 55:15
I was gonna make a joke about seeing the movie on PornHub. But I'm not going to make that joke.
Dominic Cummins 55:20
That is true. I had all the times I've said that title I've ever thought that you say it. That's awesome.
Ron Caruthers 55:27
Sorry, mom. Again, if you're watching, it was a joke. Someone asked me if a recession, this one just came across the feed here. And I know Dominic's gotta go in three minutes, because he's got a podcast with digital marketer, he's got some more important stuff to do, than hang out with me and educate y'all. But if you guys are just joining, it's to make more keep more podcasts, we do it every Friday at 8am. Pacific, it's posted on my feed. I don't know if it's posted on your opinion, somebody asked if we were going to post it elsewhere. We're working on that we gotta get the audio stripped off and all that stuff. But
Dominic Cummins 56:00
yeah, make sure on this one, download it. And I'll get it over to me. And we'll start doing that. When you when you save it.
Ron Caruthers 56:07
It doesn't give me that option. So I'll have to chat about that. So if there's a correlation between a recession and the housing market, not always, ironically, there's generally not a correlation between the stock market and a recession, because a lot of times Wall Street's trying to go ahead of that. And so they turn around and you'll see it priced in so their own art Oh, it's correlated. However, this time it might be because what you had was the government interfering with kind of the natural flow of the market by suspending foreclosures, suspending evictions. And now that's starting to go away. So you might have a post COVID recession, along with a spike in foreclosures, which will drive prices down but you know what, who knows? And then Dominic your local crack babies who definitely think some cooler than you because I watch the wire wants to know if your podcast live is live or you're recording it for later.
Dominic Cummins 57:11
You know, actually, they didn't tell me I think I think it's must be later because we're joining them on Zoom. So my guess is it's recorded, They'll edit it up. So I will get it out there if you guys I mean, I Well, technically I sit on their board. So maybe I guess I have a vested interest. But if you are a marketing agency or business owner, digital marketer is a really good place actually, ironically, Ron as we turned me on to Digital Marketer way back when and I've turned that into, into quite a quite the relationship with them. So they are digital marketers. I think it's called agencies talk as their name of their podcast. I don't think it's live I think we're recording it and then but I'll put it up on my Instagram. When we have it when it when I know that there's an episode coming up.
Ron Caruthers 57:53
Beautiful. Hey, it's the top of the hour so we will wrap this up someone just asked if I had read or either one of us would read read dahlias book or Leo's book. I have not but I will add it to the list and check it out and then will sometime in the next few weeks be qualified to give an opinion on that.
Dominic Cummins 58:10
Yeah, I read the original one but it's a long time ago he's written a few there's one I can't think of the title of the first one it's pretty well known it's called it's like a one word title like principles or something like that. That's it's pretty good. But it's been a long time so I can't remember so
Ron Caruthers 58:26
you can call me your local the crack babies may be off putting to the to the viewer dude that's your name we love you lovely Cgap you you guys regulars man we like having you guys for sure. Anyway All right, next week. We will get a good title for you guys we don't know yet what it is Dominic we'll see you in an hour on that other thing go be brilliant for the look of the Digital Marketer guys and I think it is oh look at that it's expresso o'clock time for another espresso. Elia to this morning. Oh, that's a lie. I have three. So anyway, I think one more and I'll be set right with the universe. Awesome. Alright guys, I hope you guys learned some stuff. We'll do it again next week like we always do. And then the one after God, I think he's going to be done from the airport because I'm fixin to head out of town for a little bit.
Dominic Cummins 59:20
So yeah, I may be out of town for one of those too. So awesome.
Ron Caruthers 59:23
We'll do it you guys later. Bye. All right, guys.
Dominic Cummins 59:25
Thank you so much.
Transcribed by https://otter.ai
